Acquisition of Superconducting Magnet Business

RNS Number : 9880X

Avingtrans PLC

28 February 2017

 

28 February 2017

Avingtrans Plc

("Avingtrans", the "Company" or the "Group")

Avingtrans Acquires Superconducting Magnet Business

Avingtrans PLC is pleased to announce the acquisition of a majority stake in superconducting magnet and cryogenic systems company Space Cryomagnetics Limited, trading as 'Scientific Magnetics' (the "Acquisition") for total consideration of £347k.

Scientific Magnetics, based in Abingdon, Oxford with 15 members of staff, was formed in 2000 as a spin-out from Oxford Instruments, before becoming fully independent in 2005.  It designs, manufactures, tests and installs superconducting magnet systems for a range of applications, as well as providing consultancy services to blue chip companies, such as Siemens and Rolls-Royce.

The Acquisition will bring Scientific Magnetics' expertise in superconducting magnets and cryogenics together with the Company's own engineering and volume production division, which also has a long track record of innovation in the medical and space sectors. In addition, Scientific Magnetics will broaden the Group's capability in the supply of vacuum vessels and cryostats for Big Science, space and astronomy projects. Scientific Magnetics has recently developed a number of exciting technologies, including a helium-free magnet system for pre-clinical MRI and ultra-high vacuum (UHV) applications, and the Directors believe that the Acquisition will enable Scientific Magnetics to bridge the gap between prototype development and commercial production; a proven area of expertise for Avingtrans.

Steve McQuillan, CEO of Avingtans, commented:

"We are delighted to have completed this deal, which will deliver a real step change in our offer to several key markets.

"The Acquisition aligns with our 'buy and build' strategy, which also saw us purchase the assets of oil & gas manufacturer Whiteley Read in December 2016. We are looking forward to working with the Scientific Magnetics team to deliver on what are genuinely exciting opportunities across a number of key markets."

Consideration for the Acquisition is £347k (the "Consideration"), payable by way of £285k in cash and £62k to be satisfied by the issue of 27,233 new ordinary shares in the capital of Avingtrans (the "Consideration Shares"), in exchange for 94 per cent. of the issued share capital of Scientific Magnets. The Consideration Shares are to be issued at a price of 226.5p per share, being the average mid-market closing price of the Company over the five trading days prior to signing the share purchase agreement in respect of the Acquisition. As part of the Acquisition the Company has also agreed to repay an outstanding loan and accrued interest owed by Scientific Magnets, amounting to approximately £468k.

For the year ended 30 June 2016, Scientific Magnetics reported turnover of £2.0m and profit before taxation of £41k.

Application will be made for the Consideration Shares to be admitted to trading on AIM, with such admission expected to take place on 6 March 2016 ("Admission"). Following Admission, the Company's total issued share capital will be 19,171,123 Ordinary Shares. Avingtrans does not hold any Ordinary Shares in treasury and therefore following Admission, the total number of voting rights in Avingtrans will be 19,171,123.

The above figure 19,171,123 may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, Avingtrans under the FSA's Disclosure Guidance and Transparency Rules. 

Enquiries:

Avingtrans plc Steve McQuillan, CEO Stephen King, CFO	0135 469 2391
N+1 Singer Shaun Dobson Lauren Kettle	020 7496 3000
Newgate (Financial PR) Adam Lloyd Ed Treadwell James Browne	020 7653 9850

About Avingtrans

Avingtrans plc is engaged in the provision of highly engineered components, systems and services to the energy, medical and traffic management industries worldwide. 

Energy and medical, engaged in the design and manufacture of safety critical equipment for the energy, medical, science and research communities, including oil and gas extraction and processing equipment, nuclear process plant, machined and fabricated pressure and vacuum vessels and components. Also, design and manufacture of fabricated poles and cabinets for roadside safety cameras and rail track signalling.

The strategy of the group, is to "buy and build" in regulated engineering niche markets, where we can see potential consolidation opportunities, which can lead to significantly increased shareholder value over the medium to long term.

 

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